Background information

The Spanish economy, like the rest of the European countries, is currently facing major challenges on a global scale. Geopolitical tensions, the withdrawal of expansionary monetary policies and the growing importance of sustainability on the international agenda, among other factors, may pose a risk to the competitiveness of some economic activities and, at the same time, generate opportunities in other sectors. Consequently, it is necessary and urgent to promote the transformation of the Spanish production model in order to preserve the integration of Spanish companies in global value chains and, in this way, reinforce the competitiveness and resilience of the Spanish economy. Public support resources, both national and European, are not sufficient to meet the financing needs associated with investments for the modernisation of the national productive fabric. They must therefore be complemented with funds from third parties (private). In this way, attracting foreign investment is a decisive element. For this reason, Royal Decree-Law 8/2023, of 27 December, created the "FOCO" Co-investment Fund, a fund without legal personality, attached to the Ministry of Economy, Trade and Enterprise.

Content of measure

Royal Decree-Law 8/2023, of 27 December, created the "FOCO" Co-investment Fund, with the aim of attracting foreign investment and promoting productive modernisation, sustainable growth and the ecological and digital transition of the Spanish economy. FOCO is a fund without legal personality and of indefinite duration, and initially endowed with up to €2 billion. FOCO is aimed at co-investment by the Spanish State in eligible companies, existing or newly created, with registered offices in the European Union and with a place of business in Spain, together with foreign investors. Specifically, the Fund will provide financial support on a co-investment basis with different types of investors, including, for example, the following: (i) foreign public institutions (such as public pension funds, sovereign and sub-sovereign funds or multilateral institutions investing in private capital markets), (ii) long-term foreign private institutional investors (such as investment funds, pension funds or insurance companies), and (iii) foreign capital companies that participate in corporate entities in Spain, to carry out investment projects and productive activities susceptible of being supported by the Fund. The investments will be made under profitability and market risk criteria, and will be aimed at companies that develop business models aligned with the principles of strengthening the potential growth of the Spanish economy and job creation, boosting public and private investment, modernising the productive fabric, accelerating the dual ecological and digital transition and reinforcing the country's social and economic resilience. For each operation, the funding provided by the entity or entities acting as co-investors must always be, in aggregate, equal to or greater than that of FOCO. Likewise, FOCO's capital investments must, as a general rule, be temporary in nature. The design of the FOCO instrument will enable the Spanish State's budgetary contribution to have a multiplier effect by requiring the participation of third party investors in projects that favour the sustainable development of the Spanish economy. In short, the Fund aims to promote the attraction of foreign investment in order to boost investments in Spanish territory that contribute to strengthening the potential growth of the Spanish economy. The Fund will be managed by the Compañía Española de Financiación del Desarrollo (Spanish Company for the Financing of Development), COFIDES S.A., a state trading company with public-private capital.

Use of measure

There is no estimate of the number of users.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Larger corporations	Does not apply to citizens

Actors and funding

Actors	Funding
National government Company / Companies	Companies National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	No involvement	No involvement
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

• No involvement
• Main level of involvement: N/A

Involvement

Social partners do not take part in the design and approval of this measure.

Views and reactions

No information available.

Sources

• 27 December 2023: Royal Decree-Law 8/2023, of 27th December (www.boe.es)